Would You Buy A Share

The chip leader of the WSOP with about 600 people left is offering to sell 1% shares of himself for $4,000. This works out to $400,000 for 100%. First place is worth $10,000,000. For this to be an even money proposition the odds of him winning should be 400,000/10,000,000 = 4%.

Is this a good deal with about 600 left?

Quote: kenarman

The chip leader of the WSOP with about 600 people left is offering to sell 1% shares of himself for $4,000. This works out to $400,000 for 100%. First place is worth $10,000,000. For this to be an even money proposition the odds of him winning should be 400,000/10,000,000 = 4%.

Is this a good deal with about 600 left?

Why are you only considering first place money?

Nobody has a 4% chance of winning with 600 people left. But most of the value is in all the other places that pay (combined).

It would become profitable at 15th or higher. He would have to make the final table for you to double your money.

Quote: kenarman

It would become profitable at 15th or higher. He would have to make the final table for you to double your money.

That has nothing to do with how you calculate EV. You need to take a weighted average of all possible outcomes, including those where you win part (but not all) of your money back since that adds some EV as well.

Suckers bet.

I would tend to make that decision largely on a player specific basis as much as anything else. I do understand that probably isn't what you're asking here, you're probably looking to take that out of it and consider it for discussion here without such judgement, based on math, which other people here will no doubt evaluate better. But, just sayin'. Cause while chip stacks eventually tend to become the most significant weapon in MTTs, more so than cards, they are not equally useful tournament weapons without regard to who is using them, as you probably know. And this early... one hand... and *poof* chip leader at this point can still be effectively crippled just that quick.

Quote: speedycrap

Suckers bet.

Why do you say that?

With about 500 players left, and $62M in prize money to be given away, the average value of all the players left (not median, and not the average chip stack) is $124k.

Calculating the value of the big stack is difficult, but it is not so far-fetched that it in the range of 3-4x the average of all players. Note that he has about 2.8% of all the chips in play. That implies a 2.8% chance of winning the tournament (assuming equal skill levels). That means that even if you didn't get any money at all for a 2nd or below finish, the 1% share would still be worth $2800. It's not hard to imagine that all the other places combined add another $1200+ to the EV.

Not sure the $124K average figure is very meaningfull in this discussion because of the weighting of the payouts. Only 55 players would make that much or more.

Quote: kenarman

Not sure the $124K average figure is very meaningfull in this discussion because of the weighting of the payouts. Only 55 players would make that much or more.

So? EV is an average. You have a small chance at a very large payout. First place wins 25x your money. 2nd place wins 12.9x. 3rd wins 9.5x, etc.

Of course the most likely result is that you lose money, but that has nothing to do with whether it is a good bet.

The most knowledgeable and serious of tournament players I'm familiar with use something commonly referred to as "ICM" which is shorthand for "Independent Chip Model" to calculate their equity, and to guide some decisions during a hand, as well as sometimes in a chop agreement (which can't occur here - but perhaps is close to what you'd want to know - "what is a fair 600-way [sheesh!] chop). I refuse to play in the sort of tournaments where I think anyone is likely to have a clue what "ICM" means, and I don't feel I'd do a particularly good job of describing it, and it is likely to be counter-intuitive at first in some ways to many people. So, here are a few links to get someone started (only just started) if you'd like to explore that further, including one online ICM calculator:

Very brief Wikipedia summary: http://en.wikipedia.org/wiki/Independent_Chip_Model

More explanatory: http://www.thepokerbank.com/strategy/tournament/icm/what/

One example of an ICM calculator, of many you could find: http://www.icmpoker.com/icmcalculator/

And does he play differently by taking unneeded risks at pots when he has less to lose, but more to gain? He could go for it all knowing he has this money to fall back on now assuming he sells 30-40%.

Quote: DrawingDead

The most knowledgeable and serious of tournament players I'm familiar with use something commonly referred to as "ICM" which is shorthand for "Independent Chip Model" to calculate their equity, and to guide some decisions during a hand, as well as sometimes in a chop agreement (which can't occur here - but perhaps is close to what you'd want to know - "what is a fair 600-way [sheesh!] chop). I refuse to play in the sort of tournaments where I think anyone is likely to have a clue what "ICM" means, and I don't feel I'd do a particularly good job of describing it, and it is likely to be counter-intuitive at first in some ways to many people. So, here are a few links to get someone started (only just started) if you'd like to explore that further, including one online ICM calculator:

Very brief Wikipedia summary: http://en.wikipedia.org/wiki/Independent_Chip_Model

More explanatory: http://www.thepokerbank.com/strategy/tournament/icm/what/

One example of an ICM calculator, of many you could find: http://www.icmpoker.com/icmcalculator/

I put in chipcounts and payouts for final table only in the calculator you provided and it came out pretty much to $4m just what he is asking. This is all theoretical now of course since chip counts and players left have all moved on.

I didn't see who was doing this. Was it mentioned in this thread, if not who was it?

In my opinion, anyone getting their buy-in back by selling shares is bound to play more aggressively afterwards, not necessarily a bad thing, versus those who just want to make the money or get on TV. Playing scared can hinder your decision making skills, and at that level, with TV cameras around and all, losing that stress and knowing you still have lots of prize money coming should you move up, can be good.

So, the results don't determine the answer the original question of whether this was a fair staking offer or not, but for entertainment purposes only: Do you know how this guy finished, assuming he isn't part the final table in November & his tournament is therefore done?